The Bankwatch

Tracking the consumer evolution of financial services

Canadian Banks & Insurance | RBC, Scotiabank to Add Branches

In a reversal of recent trends, building branches is becoming popular, in order to attract market share and deposits. 

Royal Bank, the country’s largest bank by assets, may build as many as 112 branches in the next four years, Chief Operating Officer Barbara Stymiest said today at a CIBC World Markets investor conference in Montreal. Scotiabank, the third-biggest bank, plans to open 30 branches next year, Chief Executive Officer Richard Waugh said at the same conference.

Canadian Imperial Bank of Commerce, the fifth-largest bank, said last month that it plans to open or expand 70 branches in the next five years.

Source: Canadian Banks & Insurance

112 branches will cost $1.7 Bn, and add $170 million in annual expenses.  The increase represents a 10% increase in branches, so that suggests that the other 90% of branches have to support the 10% over the 5 years it takes for them to develop profitability.

I keep going back to the “23 branches in 3 months (using Internet)” story and the “Bank for every block (and empty)” story whenever I see this return to branch building.

 

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Written by Colin Henderson

October 5, 2006 at 21:01

Posted in Branch, Online Banking

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